Which of the following is a primary market lender?

The primary market refers to the part of the financial system where new securities are created and sold directly to investors. In the context of lending, primary market lenders are those entities that provide loans directly to borrowers.

A mortgage banking company acts as a primary market lender because it originates and funds mortgage loans with its own capital or through the issuance of securities. These companies are directly involved in the lending process, making them essential players in the primary mortgage market. They provide borrowers with funds to purchase homes and do not merely act as intermediaries.

In contrast, the Federal Housing Administration and the Veterans Administration are government agencies that provide insurance and guarantees for loans but do not directly lend money themselves. A mortgage broker functions as an intermediary, connecting borrowers with potential lenders but does not fund loans directly, thus placing them outside the definition of a primary market lender. This distinction is crucial in understanding the roles of various entities within the mortgage lending landscape.